By now, you’ve heard about the Xoom natural-gas project, which is the biggest single natural gas project in the country and the biggest in the world.
That’s because Xoom is so big that it’s the world’s biggest producer of natural gas.
But it’s also the second largest producer of conventional gas.
That means Xoom owns the largest gas reserves in the United States and Canada, according to a 2014 report by Bloomberg New Energy Finance.
And the company’s profits are skyrocketing: in 2014, the company earned $2.9 billion in profits and $5.6 billion in net income.
And, according the company, those profits will double over the next two years, to $8 billion in 2017 and $12 billion in 2020.
And if Xoom continues on its current path, it will earn $8.8 billion by 2021, more than double the $6.4 billion earned by Enbridge in the same period.
Now, if you want to understand why Xoom has such a large financial stake in the fracking industry, the story starts with a deal signed by the company and the state of New York.
Under the deal, Xoom signed a 30-year contract to drill a natural-resource-rich gas well near the village of Ochoa in the Hudson Valley.
The project would create a natural gas pipeline that would bring gas from the nearby Bakken fields to New York City, which would be the second-largest natural-energy hub in the nation after Los Angeles.
In return, Xomas gas would flow to an export terminal in the state.
And that’s how Xoom got the big deal.
New York Governor Andrew Cuomo had no problem with the deal.
“They’re a natural company,” he said.
“You have a huge natural gas resource, you’re a big market for natural gas.”
The gas company wasn’t the only beneficiary of the deal: the state also got an enormous amount of economic development.
In addition to bringing jobs to the region, the pipeline would allow Xoom to create more than 300 new jobs in New York state.
But, for the natural gas company, the deal is a blessing in disguise: it allowed it to continue to make a killing on fracking, which it did, too.
And because Xomos natural-resources business was so lucrative, the state allowed Xoom’s management to keep its profits.
“We’re very fortunate that the New York Legislature gave us the opportunity to operate a gas exploration and production facility,” said Gary Ries, XOM’s chairman and chief executive officer.
“As the natural-sourcing business grows, so does our business.”
That’s partly because XOM was already doing the right thing.
According to the New Jersey Division of Energy and Natural Resources, in 2016, Xoom had invested $5 billion in gas drilling and fracking projects.
That figure is likely higher, since Xoom hasn’t disclosed any details about how much it invested in gas projects or how much of its profits are used to pay its employees.
But even if Xom’s drilling and production profits are lower than they were, they’re still significant.
In 2016, for example, Xompos total operating profit was just $1.1 million, which was down from $4.7 million in 2014.
And Xom still earned a whopping $2 billion in revenue that year.
And those numbers are growing.
“In 2016, we had a total revenue of $17.9 million,” Ries said.
The company’s total profits last year grew to $3.8 million.
That represents a 15% increase from 2014, when Xom was generating $1 billion in profit, and a 28% increase in profits from the year before.
But Xom has a long way to go to match its 2014 results.
For one thing, Xoms revenue was down 20% in 2015 from 2014.
Its drilling and exploration operations had slowed down.
And as Xom had to rely more on natural gas production, the gas company lost money, too, Ries noted.
“The industry was so large, and the costs were so high,” he explained.
The New York Department of Environmental Conservation reported that Xom lost $4 million on gas drilling projects last year.
That meant Xom made a loss of nearly $2 million on the project.
That was not a sustainable situation for a company that was already struggling with low gas prices and a stagnant natural-Gas economy.
“It’s important to note that the total costs of Xoms natural-Energy projects in 2016 were significantly lower than the costs of those in 2014,” Rie explained.
“That means Xom incurred less than one-third of the costs associated with those projects in 2015, and therefore received less than half of the revenue.”
And while Xom did not disclose its actual expenses in 2016 as part of its annual report, a company spokesperson told Bloomberg that it